24th Jun 2021 08:37
(Alliance News) -Â Distribution and services firm Bunzl PLC on Thursday said it has seen "good overall growth" in its first half, with a recovery in its base markets helping to offset a decline in Covid-related orders.
Shares in Bunzl were up 2.4% at 2,440.00 pence in London on Thursday, placing the stock at the top of the FTSE 100 index in opening dealings.
Revenue for the period ending June 30 is tipped to rise 1% year-on-year, and by around 6% to 7% at constant exchange rates.
"At constant exchange rates, underlying revenue growth is expected to reflect a strong recovery in the base business, including the foodservice and retail sectors, largely offset by the anticipated decline in larger Covid-19 related orders. Underlying revenue over the first half is expected to be approximately 6% higher than the comparable 2019 period," Bunzl added.
The firm in 2020 got a boost from sales of Covid-19 related products such as gloves, masks and sanitisers.
Bunzl left its revenue guidance for 2021 unchanged, but did lift its margin outlook.
"At constant exchange rates, underlying revenue is expected to be moderately higher in 2021 compared to 2019, demonstrating the resilience of the Bunzl business model. The group is increasing its adjusted operating margin expectations for the year to be slightly ahead of historical levels," the company said.
It added that it completed the acquisition of two businesses at the end of May.
The first is Comax, a distributor to the leisure, janitorial, care home and foodservice sectors in the UK, which generated sales of GBP14 million in 2020. It supplies an array of cleaning and hygiene products, as well as catering and kitchen supplies.
The second is Harvey Distributors, a cleaning and hygiene distributor in Australia which achieved 2020 revenue of GBP4 million.
"Growth through acquisitions is an important part of the ongoing strategy for Bunzl and I am pleased to welcome both Comax and Harvey Distributors to the Bunzl family. Both businesses strengthen the group's cleaning & hygiene operations, an area we expect will be supported by enhanced hygiene trends," said Bunzl Chief Executive Frank van Zanten.
The deals pipeline remains "active", he added, with talks ongoing.
By Lucy Heming;Â [email protected]
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